India's Online Ad Spend Continues Double-Digit Trajectory

Online advertising budgets in India have been tipped to grow at the fastest pace since 2011.

A new report from the Internet and Mobile Association of India (IAMAI) and IMRB International outlines a series of predictions for online ad spend within the country between 2014-15.

According to the results, a total of Rs 2,750 crore (£276 million) was dedicated to marketing via the internet in the year to March 2014. Both organisations expect this to reach Rs 3,574 crore (£359 million) by the same period next year, with increased spend on search and display driving the growth.

Video ads will also contribute to the 30% lift in spend year on year, while new ways to measure return on digital activity make for an appealing proposition.

Growth maintained

Since reaching a total of Rs 1,140 crore (£110 million) in 2011, India’s online advertising market has seen three years of double-digit growth. A 54% year-on-year rise saw the total hit Rs 1,750 crore (£170 million) in 2012 as brands began to shift more spend from offline to online.

Search and display are driving most of the growth, accounting for 38% and 29% of all money spent online, but new contributors are starting to emerge.

Spend on video ads rose 51% between 2013-2014 and its annual total of Rs 303 crore (£30 million) could be expected to grow even higher over the next year. Mobile marketing is also expected to play a bigger part in 2015 and beyond, keeping to a compound annual growth rate of 43% in the year to March 2015.

At present, though, desktops are still dominating spend by device - accounting for 86% compared to mobile’s 14%.

Online gains importance

Aside from growth through individual channels, the report sees online advertising as a whole becoming far more valuable to businesses across India.

Part of the growth has been pinned to better tools for online ad measurement, while improvements in the country’s broadband infrastructure have been tipped to boost spend in content-rich ads - where strong connections are required.

Overall spend on advertising in India reached Rs 38,598 crore (£3.8 billion) in 2013, with an offline favourite in television accounting for 44% of the total.

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Richard Towey

Richard is a former head of content at PerformanceIN. After many years spent covering developments from the automotive, sports, travel and finance sectors, he eventually turned his full attention to reporting on stories from the fast-evolving world of digital marketing.